New business registrations exceed target for five-year high

The same week that Thailand was named Best Country to Start a Business by U.S. News & World Report, the Ministry of Commerce reported that new business registrations in 2017 rose 16 percent for a five-year high, exceeding the target set by the government at the start of the year.

Newbusiness registrations totaled 74,500 in 2017, up 16 percent from 64,200 in 2016.The total registered capital of new companies surged 119 percent year-on-year to nearly $16.4 billion, according to statistics released by the Ministry of Commerce. The ministry credited the resurgent economy, growing tourism and the government’s massive infrastructure investment projects for creating the conditions to foster the growth of new businesses.

“The number of new business registrations in 2017 outstripped the department’s forecast of 70,000,” said Kulanee Issadisai, director-general of the Business Development Department at the Ministry of Commerce.

“It was largely because of the government’s tax incentives to support individual entrepreneurs. The government’s massive investment in myriad transport infrastructure projects also helped build up the confidence of the private sector,” she added.

In addition, the government has made great strides in making it easier to establish a business. It has cut red tape and bureaucracy and shortened the time it takes for processes required to found a company, such as obtaining various licenses.

The government’s efforts earned it recognition by the World Bank in its annual global report and rankings on Ease of Doing Business. The Bank raised Thailand a stunning 22 places in the standings, from 48th to 26th in the world for ease of doing business in just one year.

But it wasn’t only the World Bank that recognized Thailand’s progress. A survey conducted by U.S. News & World Report of over 20,000 individuals, mainly business decision-makers, on four continents found that Thailand’s reputation for ease of doing business has dramatically improved. The result was the magazine ranked the Kingdom number one in its Best Country to Start a Business category in its annual Best Countries list last week.

The improving economy is also having a positive effect on household debt. Household debt was forecast to slightly fall this year by the Kasikorn Research Center, a unit of Kasikorn Bank, one of the Kingdom’s leading financial institutions.

Economists and policy makers regard household debt as an area of concern in Thailand. Household debt peaked at 81.2 percent of gross domestic product in 2015. Kasikorn Research Center forecast that it would decline to 77-78 percent of gross domestic product in 2018.